The Malaysian Takaful Association (MTA) has launched the Value-based Intermediation for Takaful (VBIT) Roadmap 2022 on the 5th October 2022. The roadmap follows the launch of the VBIT Framework last year on the 23rd June 2021.
VBIT aims to address socioeconomic issues through Takaful relating to safeguarding the fundamentals of faith, life, lineage, intellect and wealth. The roadmap sets out 32 initiatives which are targeted to be completed by the fourth quarter of 2024 with the VBIT full report to be published in the first quarter of 2025.
“Implementing VBIT involves adhering to the Shariah principles, creating positive impacts and generating sustainable financial returns for stakeholders. The VBIT Framework empowers Takaful operators and provides guidance on how they can deliver value through Takaful business activities while contributing to building a strong and financially-resilient nation,” Elmie Aman Najas, the chairman of the MTA, shared.
Spearheaded by the MTA, which represents Malaysia’s 18 Takaful operators and re-Takaful operators and promotes the interest of its members and supervises the exercise of self-regulation within the Takaful industry, the roadmap sets out key outcomes underpinned by five thrusts.
The key outcomes that have been identified are financial resilience for B40 (bottom 40% of the Malaysian household income) customers, financial literacy and awareness, green and sustainable operations, efficiency and effectiveness of Takaful operations, green investment, strong corporate governance and professionalism and knowledge and competency of the industry.
The roadmap identifies eight high-scoring initiatives which Takaful operators and re-Takaful operators are recommended to prioritize implementing in their VBIT journey. The high-priority initiatives notably include, among others, calculating their carbon footprint (scope 1, 2 and 3), preparing sustainability statement reports and creating an internal sustainability framework.
The roadmap also identified eight high-scoring initiatives for the Malaysian Takaful industry. The industry-wide initiatives primarily center around promoting literacy and outreach. However, it listed the development of a product/model that enables lower capital requirements as the highest scoring initiative for the industry.
If fully implemented, by the end of 2024, some or the majority of Takaful products will be affordable and simple, a marketplace for Takaful products will have been established for easy reference and comparison, VBIT will be part of Takaful companies’ strategy in some or all departments, scorecards for VBIT will be available for the industry and programs on VBIT will be available at the industry level, among others.